Caspian Brief: June 7, 2017
World Bank projects economic growth in Central Asia in 2017-2018
Growth in the Europe and Central Asia region continued to pick up in the first half of 2017, with commodity exporters and commodity importers alike achieving recovery. The region has benefited from rising oil prices, benign global financing conditions, robust growth in the Euro area, and generally supportive policies in several large countries in the area, according to the World Bank report “Global Economic Prospects June 2017: A Fragile Recovery”.
Strengthening activity indicators suggest Russia continues to expand in the first half of 2017, and modest monetary easing is anticipated to support growth in the near term. Among other commodity exporters, Kazakhstan’s rebound accelerated, helped by fiscal stimulus, and Azerbaijan showed some signs of improvement, the report says.
Among commodity-importing economies, the recession in Belarus shows some signs of abating, helped by Russia’s recovery.
The report forecasts that growth in Europe and Central Asia is to accelerate broadly to 2.5 percent in 2017, and to 2.7 percent in 2018, supported by continued recovery among commodity exporters and unwinding of geopolitical risks and domestic policy uncertainty in major economies in the region.
SCO to expand as Xi attends summit
The Shanghai Cooperation Organization (SCO) will accept India and Pakistan as full members, which will not have an impact on the unity of the organization, but the SCO will offer a platform for New Delhi and Islamabad to solve their disputes between themselves, experts said. Chinese President Xi Jinping is set to visit Kazakhstan from Wednesday to Saturday and attend the 17th SCO summit in Astana, capital of Kazakhstan, where India and Pakistan, two SCO observers, will be granted full membership, Chinese Assistant Foreign Minister Li Huilai said at a press conference on Monday. The six current SCO members, China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan, are all located along the ancient Silk Road and share the “Shanghai Spirit” of mutual trust, mutual benefit, equality, consultation, respect for cultural diversity and the pursuit of a common development, the Xinhua News Agency reported.
During the press conference, Li also said China supports membership for Iran, which is currently an observer. Li said Iran has “proactively participated” in its activities and has made positive contributions to the SCO’s development, Reuters reported. “China welcomes and supports Iran’s wish to become a formal member of the SCO,” and “I think that at this meeting all sides will continue to conscientiously study the issue of Iran becoming a member on the basis of the SCO’s relevant rules and consensus through consultations,” Li Huilai said. “In the next stage, Turkey and Afghanistan might also become members after Iran. The SCO’s expansion will definitely bring more diverse voices, and the period of reaching consensus will also be extended. But in the long-run, once the members reach agreement, it will represent the interests of a broad region with great international influence,” Lin said.
OSCE to monitor border area between Azerbaijan, Armenia
The OSCE is expected to monitor the border of Azerbaijan and Armenia on June 7, Azerbaijan’s Defense Ministry reported on June 6.
The monitoring will be held under the mandate of the OSCE chairperson-in-office personal representative in Azerbaijan’s Alibayli village of Tovuz district.
On the Azerbaijani side, the monitoring will be held by field assistants of the OSCE chairperson-in-office personal representative Mikhail Olaru and Simon Tiller.
On the Armenian side, the monitoring will be carried out by field assistants of the OSCE chairperson-in-office personal representative Gennady Petrica and Martin Schuster.
OSCE MG co-chairs expected in Baku in mid-June
The co-chairs of the OSCE Minsk Group on the settlement of the Armenian-Azerbaijani Nagorno-Karabakh conflict are expected to arrive in Baku in mid-June, presumably on June 19, a diplomatic source told Trend June 7.
Erdogan: OSCE MG couldn’t resolve Karabakh conflict
The OSCE Minsk Group couldn’t resolve the Armenian-Azerbaijani Nagorno-Karabakh conflict, Turkish President Recep Tayyip Erdogan said, the country’s Haber7 TV channel reported June 7.
Erdogan noted that the OSCE Minsk Group’s activity on the resolution of the conflict is ineffective.
He added that the OSCE Minsk Group co-chair countries are members of the UN Security Council.
“When one of these countries stands for the settlement of a conflict, the other one puts a veto on this,” Erdogan said. “This is the main obstacle to the resolution of conflicts.”
Georgia Hosts Joint Military Exercises With Azerbaijan And Turkey
Special forces units of Azerbaijan, Georgia and Turkey launched joint “Caucasian Eagle 2017” exercises on June 5. The drills are hosted by Georgia and they will last till June 14.
The three countries’ forces will practice coordination, as well as conducting special operations. Ground and air components will both participate in the exercise.
This is the third trilateral special forces drill by Azerbaijan, Georgia and Turkey. The latter hosted the previous two exercises.
The special forces exercises fall within the broader framework of developing military cooperation between the three nations. On May 23, Defense Ministers of Azerbaijan, Georgia and Turkey held the fifth trilateral defense ministerial summit in Batumi and discussed, among other issues, joint military exercises and security measures for regional economic projects.
Besides the special forces drills launched on June 5, joint computer-assisted staff-level exercises to be held in September 2017 were also announced during the May 23 trilateral ministerial.
Russia strengthens military bases in Tajikistan and Kyrgyzstan
Russia equips its military bases in Tajikistan and Kyrgyzstan with the latest weapons to prevent the transfer of terrorist activity from Afghanistan to the Central Asia, RIA Novosti News Agency quoted Russian Defense Minister Sergei Shoigu as saying.
“Russian Defense Ministry is taking measures to prevent the transfer of terrorist activity from Afghanistan to the Central Asian region. We increase the combat readiness of Russian military bases in Tajikistan and Kyrgyzstan and equip them with modern weapons and military equipment for this purpose,” Shoigu said at a meeting of Defense Ministers of the member states of the Shanghai Cooperation Organization (SCO) in the city of Astana on June 7.
According to Shoigu, Russia as well provides assistance to the armed forces of the Central Asian states and pays great attention to increasing their combat capabilities. He went on to add that Russia regularly holds joint military drills with the Central Asian countries.
He informed that in September it is planned to hold military anti-terrorist exercises of the member states of The Collective Security Treaty Organization.
Uzbekistan, Azerbaijan set up oil, gas join venture
Azerbaijan and Uzbekistan have set up a joint venture to extract oil and gas. The joint venture will be operating in the Caspian Sea basin and in Uzbekistan, the director of the Institute for Geology and Developing Oil and Gas Deposits (Uzbekistan), Gaybulla Abdullayev, has told Haqqin.az news website.
“The volume of joint work will be defined in the [next] six months. This is a new chapter in cooperation between the two countries. We are planning to set up another enterprise to develop chemical reagents. Uzbekistan wants to use the rich experience of Azerbaijan’s State Oil Company, in particular in the sphere of developing [oil and gas] fields in the sea. There are five oil-and-gas bearing deposits in our country. Uzbek gas is exported to Russia, Kyrgyzstan, Kazakhstan and China. Uzbekistan exports up to 20bn cu.m of natural gas a year,” Abdullayev said.
He said that Tashkent, to diversify its supplies, was thinking to export gas via Azerbaijan, along the Southern Gas Corridor. “The creation of Uzbek-Azeri joint ventures in the oil and gas sector is the beginning of the big work that also envisages the transit of energy resources, prospecting work and many other things,” he said.